Data Preferences for Targeted Advertising

While common sense would dictate that data obtained online would be the best source of information on which to base a digital targeted advertising campaign, a new study proves differently. According to the survey conducted by eXelate, a research firm specializing in online advertising and shopping habits, 81 percent of advertising agencies state that offline data is preferable for digital targeted advertising.

Over 875 people working in the advertising industry responded to the eXelate survey. Of those, 54 percent were ad agencies, 31 percent worked for ad platforms, networks or exchanges and 15 percent were marketers. In the survey, offline data was defined as data collected through traditional research and surveys, such as the data collected by Nielsen and other popular research agencies.

One example of offline data used for digital advertising is a strategy conceived by Nielsen. Nielsen will soon bring together online and television audiences by monitoring TV viewing behavior for the purpose of strategic online advertising campaigns. Microsoft, Videology and Adap.TV are all onboard to put Nielsen’s plan in motion.

Although ad agencies prefer using offline data for digital targeted advertising, 76 percent of ad networks, exchanges and demand-side platform (DSP) providers stated that custom data is the preferred choice. In addition, 71 percent of marketers stated that custom data was preferable. Custom data refers to data based on first-party experiences and past performance.

To further obfuscate the reasoning behind the decisions of advertisers, less than one-third of agencies and marketers and only one-quarter of networks stated that offline data was sufficient for branding campaigns. Custom data was the choice of each group for this type of advertising.  Offline data was even less popular for direct-response advertising. It was the preferred data of only 25 percent of marketers, 19 percent of agencies and 15 percent of networks. Again, the most favored type of data was custom data. The least favorable type of data was that collected through customer relationship management (CRM).

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The eXelate survey also uncovered other new information. Among the most interesting of the findings is that 100 percent of respondents are increasing their budgets for raw data in 2013. However, each group gave different reasons for the increase.  Approximately 78 percent of ad networks cited the strategic value of data as the reason for the budget increase while 70 percent of marketers stated that more data will be necessary to identify specific customer bases. Among the agencies surveyed, 68 percent stated that the increase will be used to make the data more efficient.

As online marketing becomes more data-driven, the question of what data to rely on becomes increasingly important.  The preference for custom resources makes sense considering that online advertising is becoming common among an ever-expanding variety of advertisers.  The old standard of measuring clicks just does not work in all cases, such as when the campaign is a locally-targeted display ad campaign. What sources do you find drive most of your targeting decisions?

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